Transaction Processing & Enterprise

Resource Planning Systems

Chapter 9
 Chapter 9 Outline
• An overview of Transaction
Processing Systems
• Traditional Transaction Processing
Applications
• Enterprise Resource Planning

2
An Overview of Transaction
Processing Systems

3
TPS, MIS/DSS, and Special
Information Systems

4
 Traditional Transaction Processing
Methods & Objectives

• Batch processing systems

• On-line transaction processing (OLTP)
• On-line entry with delayed processing
• Process data generated by and about transactions
• Process data generated for and about transactions
• Maintain a high degree of accuracy and integrity
• Produce timely documents & reports

5
 Traditional Transaction Processing
Methods & Objectives

• Increase labor efficiency

• Help provide improved service
• Help build and maintain customer loyalty
• Achieve competitive advantage

6
Batch versus On-Line Transaction Processing

7
Integration of a Firm’s TPSs

8
Examples of Transaction Processing

9
Transaction Processing Systems

10
 Transaction Processing Activities

• Data collection
– Should be collected at source
– Should be recorded accurately, in a timely
fashion

• Data editing
• Data correction

11
Document Production and Reports

12
 Control & Management Issues

• Business resumption planning

• Disaster recovery
– Backups

13
 Transaction Processing Audit

• Does the system meet its business

requirements?
• Are there procedures and controls?
• Are the procedures & controls properly used?

14
 Order Processing Systems

• Order entry
• Sales configuration
• Shipment planning
• Shipment execution
• Invoicing
• Customer relationship management (CRM)
• Routing and scheduling
• Scheduling systems

15
Document Production Reports

16
Traditional Transaction
Processing Applications
Order Processing Systems

18
Order Processing Systems

19
Order Entry System

20
Shipment Planning

21
Inventory Status Report

22
Invoicing

23
Customer Relationship Management

24
The 15 Top-Rated CRM
Software Packages

25
 Purchasing Systems

• Inventory control
• Purchase order processing
• Receiving
• Accounts payable

26
Purchasing Systems

27
Accounts Payable

28
Accounts Payable

29
Accounting Systems

30
Accounts Receivable

31
Accounts Receivable Aging Report

32
Typical Paycheck Stub

33
Payroll Journal

34
General Ledger

35
General Ledger

36
ERP Software Vendors

37
 International Issues

• Different languages and cultures

• Disparities in information systems infrastructure
• Varying laws and custom rules
• Multiple currencies

38
Enterprise Resource
Planning
 Enterprise Resource Planning

• Real-time monitoring of business functions

• Supports human resources, sales, and
distribution
• Accommodates the different ways each
company runs business

40
 Advantages of ERP

• Eliminates costly, inflexible legacy systems

• Improved technology infrastructure
• Improved work processes
• Increased data access for decision making

41
 Disadvantages of ERP

• Expense & time

• Radical change
• Integrating with other systems
• One vendor risks

42
ERP System

43
 Business Application
Programming Interface (BAPI)

44
 Summary
• Transaction Processing Systems - consist of all
components of a CBIS, including databases,
telecommunications, and people

• Transaction Processing Systems Methods - batch,

on-line, and on-line with delayed processing

• Enterprise resource planning (ERP) software - a set

of integrated programs that manage a company’s vital
business operations for an entire multisite, global
organization

45
 Principles and Learning Objectives

• An organization’s TPS must support the routine, day-

to-day activities that occur in the normal course of
business and help a company add value to its
products and services.

– Identify the basic activities and business objectives common

to all transaction processing systems.

– Describe the inputs, processing, and outputs for the

transaction processing systems associated with order,
purchasing, and accounting business processes.

46
 Principles and Learning Objectives

• TPSs help multinational corporations form

business links with their business partners,
customers, and subsidiaries.

– Identify the challenges that multinational corporations

must face in planning, building, and operating their
TPSs.

47
 Principles and Learning Objectives

• Implementation of an enterprise resource

planning system enables a company to achieve
numerous business benefits through the creation
of a highly integrated set of systems.

– Define the term enterprise resource planning system

and discuss the advantages and disadvantages
associated with the implementation of such a system.

48
End of Chapter 9